The St. Louis Rams & Beneficiary Designations

When the rules are in writing, you have to follow them. Unless you’re the NFL. 

I am a St. Louis Rams fan. Loyal from the time they arrived in St. Louis after failing to get a new stadium in Los Angeles. Like all Rams fans, I was really upset when they left St. Louis, even after witnessing a decade of historically bad football.

For those unfamiliar with the situation, the lease the Rams had allowed them to relocate to Los Angeles this past January. The Governor of Missouri appointed a task force to try and negotiate a new, long-term stadium deal to keep the Rams in St. Louis. The task force ultimately came up with an actionable proposal on a new riverfront stadium for the Rams.

But after the proposal was submitted, the NFL’s assigned committee recommended that teams in San Diego and Oakland (two cities that essentially had no stadium proposals) be allowed to move to L.A., instead of the Rams. Throughout the task force’s work, it appears the Rams’ ownership was uncooperative. They did not meet with the task force, talk to the media, or talk to the fans. All of this was in apparent disregard of the NFL’s relocation guidelines requiring good-faith negotiations and attempts to maximize fan support in their current home community.

In spite of all this, the league allowed the Rams to relocate to L.A.

It seems laughable to suggest that the NFL relocation guidelines were followed. An owner who refuses to take part in negotiations is not negotiating in good faith, and an owner who refuses to talk to fans or the media for four years after his intention to move has become public, is not operating in a manner that would maximize fan support.

As the Rams made the number one pick in the NFL draft this year, the fans in Los Angeles got to cheer on their new quarterback. I thought to myself: based on the NFL’s own guidelines, he should have been St. Louis’ new quarterback. I didn’t like seeing something end up in the wrong place because it seems unfair. 

Estate Planning Involves Written Rules That Have to be Followed

Unfortunately, we see unfair things all the time in our firm. In the estate-planning world, unlike the club of pro football owners, we can make written rules and trust that they will be followed. Unfortunately, too often people don’t pay close attention to the rules that are put in place through their own plans and beneficiary designations.

For example, in 1996, a man named Warren Hillman named his wife as beneficiary on his federal employee’s life insurance policy. They later divorced, and Mr. Hillman remarried four years later, but he never updated his beneficiary designation. When he died, his widow sought to claim the payout, but she was denied because she wasn’t the beneficiary. The dispute over that policy made it all the way to the U.S. Supreme Court. In 2013 the court ultimately granted the death benefits to the ex-wife because she was the listed beneficiary. (Read about more court cases involving problems with beneficiary designations on life insurance policies here.)

It’s pretty easy to picture an ex-wife enjoying money that a widow thought was rightfully hers; the same way I picture the fans in L.A. enjoying the sun and the Rams. Every day, we help clients coordinate their beneficiary designations with their estate plan to make sure everything ends up in the place you desire. After you’re gone, the best way to make sure your family knows your wishes is to leave them in writing. 

Be Sure to Update Your Beneficiary Designations in Writing

Your things (and your family) are far more important than a football team. Therefore, it is vitally important that you make sure your beneficiary designations are up to date and your estate plan is current.

Life is constantly changing, and when it does, your plan needs to be updated to reflect those changes. At Edwards Group, we have a special program that helps make sure your plan stays up to date. Read more about our Dynasty Program here.

If it’s been a while since you’ve updated your plan, give us a call at 217-726-9200 or plan to attend one of our upcoming workshops.

 

 

I just ate a cheeseburger.

At this point in the year, many of us are abandoning our New Year’s resolutions, but there’s still hope…

by Chris Flynn, Attorney

Well, we’re a few months into 2016, which means we’re also past the point where many people have abandoned their New Year’s resolutions. (I’ve started eating cheeseburgers again despite the 15 or 25 pounds I’d planned to lose this year.)

Estate Plan Organization

A common resolution in the beginning of the year is to “get organized.” I have file cabinets at home that I’ve been mindlessly throwing documents into for years. I keep meaning to clean them out. I know they hold important papers, but can’t imagine trying to actually locate any one of them. With no immediate need to know where specific paperwork is, it’s always easy to put it off for another day instead of taking a couple hours to make sure the big things are in place.

And sadly, if I never do take care of those file cabinets? My family will be left to dig through the piles of junk I’ve gathered over the years trying to figure out what’s important and what’s been left for them.

Would it help your children to know where stuff it? To easily know what bank accounts, investment accounts and insurance policies you own? To get things handled quickly and privately and as automatically as possible when you die?

We can help with this! In just a few meetings, you can know what you have, where your accounts are, where your assets are going when you die, and have it all in one place so that you or your loved ones can access it whenever it’s neededBig Red Binder web version

When you set up a trust with Edwards Group LLC, you’ll leave with The Red Binder. In it, we’ll have all the documents needed to ensure easy administration of your accounts and assets during your disability or after your death.

The Red Binder

Some of the contents of The Red Binder include:

• A Trust, stating what happens with all of your assets upon your disability or death.

• A Will, ensuring that any “straggling” assets get handled in accordance with your trust.

• Powers of Attorney, ensuring that the right people (of your choosing) have the ability to help you when you need it.

• End-of-life and burial wishes, so your family knows what you want and can avoid disputing it later.

• A summary of your plan and a summary of your assets.

In our office, Senior Asset Coordinator Laura Peffley (pictured above with clients), is constantly helping clients get their assets consolidated into one trust. If you simply have an account statement or can print one, she can usually work with that. If you can’t find a deed to your house, she can help you track it down. And ultimately, we can map out a plan together to ensure all of your assets go where you want, when you want.

Procrastination is the Enemy of Estate Plans

Even if you’ve already abandoned some of your resolutions at this point in the year, we can still help you tackle this one today. Procrastination is the single greatest threat to an effective estate plan. Don’t put it off any longer. Planning protects those things most important to you, and we make it easy to take the first step with the following options:

  1. Attend one of our free workshops. We have two regular workshops, one of which is an introduction to estate planning. It’s a great, no-pressure way to get started. And you’ll receive $200 off your Initial Meeting fee just for attending.
  2. Give us a call at 217-726-9200. Tarina, our Client Coordinator, loves helping people and answering their questions. In fact, she was a client before she ever started working at Edwards Group, so she has a unique perspective that many find helpful.
  3. Schedule an Initial Meeting. If you know you’re ready to get started and want to stop putting it off any longer, just give us a call to schedule a 45-minute meeting where an attorney will review your concerns and goals. The attorney will also help you understand the unique risks that your family faces. By the end of the meeting, you should understand your planning options, what they will cost and if Edwards Group is the right firm for you. Clients find this meeting to be very valuable in helping them understand their options.

Get back on board with getting organized by calling us at 217-726-9200 to RSVP for a workshop, ask questions or schedule an Initial Meeting.

Take Action Now: Update Your Beneficiary Designations

It is vitally important that you review all your beneficiary designations (life insurance, 401(k)s, etc.) every 2 years, or sooner in cases of births, deaths, marriages, divorce, job changes or retirement. Read on to see real court cases that show why it is so crucial.

We talk about beneficiaries A LOT around here, and the following court cases will show some of the reasons why, but first, let’s review what a beneficiary is and why it’s so important.

There are a few financial planning tools that are not passed down in wills. Things like life insurance and 401(k)s are passed down to whomever you write on the beneficiary designation form when you sign up for them. And sadly, many people NEVER change those names ever again despite the changes in their life circumstances. There are a significant number of people who take the time to care for their loved ones by taking out life insurance policies, but then don’t pay attention to who really owns it or who the beneficiary is. The tragic consequences of this oversight, impact those they love most.

Life is not a fairytale. Things do not automatically work out for the best. The law is the law, and therefore, will not be swayed by what seems reasonable for your family. These two federal cases illustrate that:

In Hearing v. Minnesota Life Insurance Company, a single father named his sister as beneficiary of his life insurance policy so the sister could take care of the daughter. He intended to change the beneficiary to his daughter once she turned 18. But he never got around to it. Sadly, the father died and the sister claimed the life insurance. Despite a handwritten note stating that he wanted his daughter to be the new beneficiary, the court found that the only thing that mattered was the name on the beneficiary designation. The sister, not the daughter, got the $100,000 pay out.

Again, in The Lincoln National Life Insurance Company v. Ruybal case, we have another “sister” situation. A single dad named his sister beneficiary because she was supposed to take care of the kids. Upon death, the decedent’s sister, his executor, and the two daughters all claimed the life insurance. The court ruled in favor of the sister, noting that, “Anyone attacking the right of a named beneficiary to receive the proceeds of an insurance policy has the burden of proving that the beneficiary is not entitled thereto.” In other words, the sister was on the form – plain and simple. Would it have been more fair for the estate or the daughters to get the money from the policy? Probably. But it is not the duty of the courts to do the reasonable thing. It is their duty to uphold and interpret the law. It is your duty to keep up to date with your beneficiary designations.

As you can see in each of these real-live cases, the court ordered payment to the named beneficiary, even to the detriment of the children of the deceased.  The clear message from the courts in these decisions is that the named beneficiary of a life insurance policy will get the death proceeds regardless of what other competing claims exist, or what one’s sense of fairness seems to dictate.

This means the burden is yours to keep up with your beneficiary designations. It is vitally important to make sure they are up to date. At the very least, you should review your beneficiary designations every 2 years. But in the case of the following life events, you should review your beneficiary designations right away:

  • Family events such as births, deaths, marriages and divorces all should trigger a review of ALL beneficiary designations.
  • Work events such as changes in business, change of job or retirement ALL should trigger reviews.
  • External events such as significant tax changes or other legal changes should also trigger a review.

Some mistakes are just not fixable. Please, double check your beneficiary designations if you have not done so recently. Edwards Group clients can rest easy because we help make sure assets are set up properly (and stay that way through our Dynasty Membership program). Join us for an introductory workshop to hear more about how we can help with estate planning.

Save Your Family Extra Anguish After You Die: Prepare a Will

Tarina, our Client Coordinator, hears it all the time, “I wish I hadn’t put off planning for so long. I just feel so much better now that we have a plan in place.”

Do you want to make things easier on your family?  Or more difficult?  Good planning will spare your family stress, conflict, and expense later.  I will never forget this article from Today.com by reporter Sharon Epperson where she talked about her father passing away and what his planning meant for her and her sisters, “By making some important decisions while living, my father helped to lessen the overwhelming stress of coping with [his] sudden loss.”

Sadly, loved ones left behind bear the burden of lack of planning.

So, what happens when you die without an effective plan or even a will?

In the US courts, if someone dies without a will it is called intestate, which basically means the state will decide what to do with any assets. There will be a lot of paperwork, court appearances, etc.

One of the most difficult things is making a list of all assets and debts. Since these types of things are not typically discussed freely, this can be a real headache for your loved ones left behind. During a time of grief they have to play detective trying to hunt down what you may own or owe.

There are also many assets that aren’t determined by a will. For these type of assets your loved ones will have to gather the necessary paperwork to prove whom the beneficiary or new owner is. Assets that aren’t passed down by will are:

  • Life insurance proceeds
  • Jointly owned assets, such as real estate or bank accounts
  • Property held in a living trust
  • Funds in IRAs, 401(k)s, or other retirement accounts
  • Payable-on-death bank accounts
  • Residential real estate with a “Transfer on Death Instrument” recorded with the county

We know there are a lot of reasons people don’t plan. Tarina says a lot people admit (after planning) that they were really intimidated by the process or didn’t feel they knew Dave well enough, but none of them regret finally taking the leap and planning. At Edwards Group we’ve worked really hard to make the process as painless and effective as possible. We also offer a money-back guarantee. Now, what attorney do you know of who does that?

If you’re ready to stop gambling on what will transpire if the unthinkable happens, here are the next steps to take:

1) Our free, no pressure workshops are a great way to learn more about the planning needs your family may have. They are also a great way to get to know our firm better.

2) If, after attending a workshop, you would like to take the next step, you will receive $200 off your initial meeting fee, and you can read more about that process here.

3) Not ready to talk to a person yet? We have put a lot of our time into developing a website that contains helpful information about all aspects of planning. You’ll find hundreds of articles about estate planning, trust, Veterans benefits, Medicaid and Medicare on our website. Feel free to use the search button to quickly get to what you need.

No matter what, I hope that you will take the time to learn about ways to protect your family and your assets. The other side of our practice involves helping people who didn’t plan properly clean up the mess that’s left behind. My sincere desire would be for every family to have effective planning strategies in place and for no family to have go through the consequences of bad planning. Take a step in the right direction today by attending a workshop, giving us a call at 217-726-9200, or signing up for our weekly email newsletter.

Everyone Over 18 Needs One of These…

At our house we like to watch the old shows like Little House on the Prairie and Andy Griffith. Bailey, our 6-year-old, loves watching “Half Pint” and Barney Fife. Those are great shows and they reinforce some great old-fashioned values.

In estate planning, there are often changing laws and new legal strategies. But there are also some old fashioned ideas that have not changed. One of those is the fact that everyone over the age of 18 should have powers of attorney for healthcare and property.

Everyone Needs a Power of Attorney

A power of attorney gives someone else the power to act for you if you can’t do it yourself. So if you have a stroke, get Alzheimer’s or get laid up and have to have your checkbook taken away, who will be in charge?

There are 2 types of powers of attorney. And you really need both of them.
  1. Power of Attorney for Property  This allows someone to help you pay the bills. It allows someone to sell your car, your house or even get funds from your IRA. It also allows them to run errands for you, like forwarding your mail, dealing with pets and filing taxes.
  2. Power of Attorney for Healthcare  This is a separate document that gives someone the power to get medical information, make decisions for you as to treatment or surgery, make end of life decisions, and follow through on organ donations. Read “Why You Need a Healthcare POA” HERE.

What happens if you don’t have one of these? Well, if you have a stroke or other disability, someone may have to go to court to seek a guardianship. Some people call this a “living probate” because you are in probate court while you are still alive. As you can imagine, this costs time and money. And the judge will oversee the guardian making your decisions.

Powers of attorney are needed regardless of wealth level for anyone over age 18. Even college kids need them in case they are injured, so their parents can have access.

Give us a call today (217-726-9200) and set up a free phone chat with Dave. Depending on the details of your unique situation, he can then recommend what the next best step will be with regards to a POA.

How to Pay for Nursing Home Costs

How do you keep life savings from being depleted by nursing home costs? Read our Nursing Home Crisis Plan Case Study to find out one of the ways we helped a client.

Couple walking no textQuick Summary

Mary recently had a stroke and will have to be placed in a nursing facility. She doesn’t want nursing home care to drain all of her savings.

Edwards Group worked to maximize Medicaid benefits as quickly as possible, created a trust to preserve assets, pre-paid funeral costs and preserved more than 50% of Mary’s assets.

Total Savings to Mary and her family: more than $100,000.

Read the full story here.

5 Reasons You Need a Trust

Trusts are a very valuable planning tool. When people think about estate planning, most people think about wills. While wills are the most basic/common tool for estate planning, trusts are an incredibly effective way to plan for things that wills can’t address. Trusts can be used to:

  1. Organize your assets so it’s easier on your family later.
  2. Set out instructions for when you’re not able to make your own decisions — either upon disability (like a stroke) or death.
  3. Keep things private. (All wills are public record.)
  4. Protect assets from creditors, divorces, kids who don’t know how to manage money and even future lawsuits you can’t anticipate (like car accidents).
  5. Reallocate assets to maximize long-term care benefits such as Medicaid or VA benefits.

If you’re ready to get started protecting what you’ve worked so hard for, call us at 217-726-9200 to schedule an initial appointment with one of our attorneys. If you want to learn more without any obligation, our free 1-hour workshop, “Intro to Edwards Group: Will and Trusts Orientation” is a great way to learn about the basics of wills and trusts while finding out why our approach is so unique and effective. After attending the workshop, if you decide to work with us, you’ll receive $200 off your Initial Meeting fee.

Contain Yourself: Fool Proof Solution to Getting Organized

Why is getting organized so much fun? Well, I should rephrase that. Getting organized is a lot of work. But BEING organized is fun. A while back Michelle and I went to the Container Store in St. Louis. Who would think there is a store with nothing but containers for storing things? And it’s fun to look around in there! The truth is:

  1. We like to be organized.
  2. We usually don’t get organized on our own.
  3. When we do get organized, it doesn’t take us long to slip back into disorganization.

You’ll be glad to hear we have discovered a fool proof method for organizing your financial life, and keeping it that way. Let us help you! There is no doubt that estate planning (as well as peace of mind and happy relationships) rest on good financial decisions and organization. Here is how we help clients in our Dynasty membership program:

  1. Store documents. We keep copies of deeds, bank statements, insurance policies, etc. for us to refer to, but also in case the client needs it.
  2. Identify Problems. We help clients identify problems in their financial life. A good estate plan will not accomplish much if the person’s wealth is poorly invested, incurring extra income taxes, exposed to risks, or confusing to deal with after their death.
  3. Summary Reports. Assets can be scattered everywhere, without any one report to pull them all together. We maintain updated client financial info, and send out an Asset Review Report on a regular basis, asking the client to review.
  4. Reminders. Asset titling and beneficiary designations may seem boring, but they are key to making an estate plan work. We regularly remind and teach our clients what to look for in coordinating their assets.
  5. Warranty. After a client has titled a new asset based on what they learned from us, they send us the written proof. We double check it to see if the asset is properly organized with their estate plan. If not, we help fix it. Once we give it our blessing, they can rest with peace of mind.
  6. Objective advice on important decisions. I don’t invest assets for clients or sell financial products. But I see firsthand the work of dozens of financial advisors as well as the results of our “do it yourself” clients. I am always glad to give feedback on my client’s financial or business decisions. Often, I support the good advice coming from the financial advisor, and help the client understand how it fits into the bigger picture. Once in a while, I protect a client who is being threatened by poor service or advice from another professional.

A great way to learn more about Edwards Group’s unique approach and what the Dynasty program can do for you, is to attend our Wills & Trusts: How to Get Started. Click here to see upcoming dates.

asset organization

Two Types of Asset Organization Mistakes

There are two types of asset organization mistakes that mess up estate plans.

What do you own?

How long would it take you to make a list of all of your assets, debts, income and the contact information for each of those? Would it take a while? If you passed away suddenly, would it take your children more or less time to get a list like that? Without easy access to that information, your loved ones will suffer more stress, delay, and expense trying to determine what you own. Some things, like life insurance, savings bonds, or stock certificates, are sometimes lost forever because the family is not aware of them.

Do the assets fit with your legal plan?

Suppose your family can easily get a list of your financial information.  Will the information show that all of your assets are coordinated with the legal plans in your Will or Trust?  Are your joint ownership, payable on death provisions, life insurance and IRA beneficiary designations all consistent with your goals?  For instance, if you have created a trust so someone can manage assets for a minor child, did still name the child as a beneficiary of your life insurance?  If so, your legal plans will have no effect on that money.

Now what?

Check out your current asset organization by looking at our Personal Information Form.  How easy would it be for your kids to fill this out if something happened to you?  Do you know for sure that your assets are organized properly and all beneficiary designations are up to date?

Jigsaw Puzzles and Asset Titling

Let’s think of estate planning as a puzzle.

1. WHAT’S THE PICTURE?

Do you like to know what the picture is that you’re putting together when you work a puzzle? In fact, when I go to buy a puzzle, I only have 2 criteria – the size (usually 500 pieces) and what the picture is. I want a picture on the front that I like.

Do you know what picture you are trying to create with your estate plan? What will your stuff be doing to impact people? How do you hope your family and others are getting along after you’re gone?

Most of my clients have a very fuzzy estate planning picture when I first meet with them. They have some ideas, but maybe not a lot of details. Or there may be things they want to do that they have never heard of until they meet with me. As we work together, their estate planning goals get clearer. As they work with me over the years, it gets even clearer, year by year.

2. MIXED UP PIECES

Once you know the picture you want, then you need the right puzzle pieces to make that picture come together.

As you go through life, you collect different pieaces of your estate planning puzzle. You buy a house with your wife. That’s one piece. Then you get a life insurance policy and name beneficiaries – that’s another. Then you put some money into a CD at the bank and name a grandkid as “payable on death.” Then you may even add a 401k, IRA, annuity, timeshare, car, jewelry, family heirlooms, etc. Each of these assets, and how they are organized and held legally, is another piece to your estate planning puzzle. If at some point you did a will or a trust, then those are additional pieces to your estate plan puzzle.

When we work with clients to gather up all these pieces (or info about them). Then we lay out all the pieces and look to see if they fit in with the picture (the plan) that we are creating with the client.

Most of the time, they don’t all fit and we have to move some assets around, change the way they are titled, so everything works together. Without this kind of coordination, when a client gets to the end of their life, the family may be left with a bunch of pieces that don’t fit together. And even if the pieces can be forced together, they may not make the picture the person had in mind for their legacy.

Do all your estate planning pieces fit together?